💵 Reciprocal Tariffs

Good morning. The weekend is not here yet, but we have our plans sorted.

Marvel’s Daredevil: Born Again is out now 🕶️ 🍿 

- Ruchirr Sharma & Shatakshi Sharmaa  

TABLE OF CONTENTS

• 💵 Reciprocal Tariffs

• 💾 India’s new chip plant

• 🗞️ Bite-sized summaries

  • 🏦 RBI meetings with Fintech giants

  • 🏅 Olympic grant

• 🧑‍🍳 What else is cookin’?

• 🍿 Entertainment, Entertainment, Entertainment

MARKETS

🇮🇳 India

• Indian stock markets rebounded strongly. This rally broke a 10-day losing streak, driven by positive global cues, strong IT sector performance, and improved manufacturing PMI data. Midcap and smallcap indices also saw significant gains, rising nearly 2%.

🌍️ International

• US markets rebounded. The recovery was fueled by strong tech earnings, particularly from Apple and Microsoft, and a surprise Fed announcement hinting at potential rate cuts. Investors also welcomed positive US-China trade talks, easing concerns over recent tariffs.

ENERGY

💵 Reciprocal Tariffs

US President Donald Trump’s latest move to impose reciprocal tariffs has put India in a challenging position. The policy, which targets nations imposing higher tariffs on American goods, includes India alongside the European Union, China, and Canada.

Trump’s stance, rooted in his “America First” agenda, aims to balance trade disparities by imposing tariffs on countries with historically higher levies on US imports.

India’s Strategy to counter the tariff challenge:

• In response, India is actively negotiating a trade deal with Washington to mitigate the impact of these tariffs.

• The recent Modi-Trump talks in February set a target of $500 billion in annual trade by 2030, with both nations committing to a new Bilateral Trade Agreement (BTA) by late 2025.

• Commerce Minister Piyush Goyal’s ongoing discussions in Washington reflect India’s diplomatic efforts to ensure favorable terms.

To address US concerns, India has taken proactive steps, including reducing tariffs on select American goods like Bourbon whiskey, wines, and electric vehicles. Additionally, India is increasing imports of US oil, gas, and military equipment to help narrow the $45 billion trade surplus in its favor. These measures signal New Delhi’s willingness to recalibrate trade policies while safeguarding domestic economic interests.

What does this mean for India?

• Trump’s tariffs pose both risks and opportunities for India. While they threaten key export sectors—such as automobiles, pharmaceuticals, and IT services—they also push India to enhance competitiveness and diversify its export markets.

• By negotiating trade agreements with other economic blocs, India can reduce dependency on the US market.

• Furthermore, the ongoing discussions highlight India’s strategic importance in global trade. As one of the fastest-growing economies, India remains a critical partner for the US.

• The reciprocal tariff issue underscores the need for India to balance diplomacy and economic strategy to ensure sustainable growth.

Read more: Economic Times

SEMICONDUCTORS

💾 India’s new chip plant

Tata Electronics announced plans to establish a display chip manufacturing unit in Gujarat, in collaboration with Taiwan-based Powerchip Semiconductor Manufacturing Corporation (PSMC) and Himax Technologies.

TL;DR:

• The proposed plant in Dholera, Gujarat, will manufacture display chips used in a wide range of electronic devices, including smartphones, televisions, LED screens, and camera sensors.

• This project complements Tata’s broader semiconductor investments, which include a Rs 91,000 crore chip fabrication plant in Gujarat and a Rs 27,000 crore chip assembly plant in Assam.

With this venture, Tata Electronics now has a presence across all major segments of semiconductor manufacturing—fabrication, chip assembly, and display chip production. This holistic approach strengthens India’s semiconductor capabilities and reduces dependence on global supply chains, especially amid growing geopolitical tensions that threaten semiconductor availability.

Implications for India

1. Boost to ‘Make in India’ and Atmanirbhar Bharat: The collaboration with PSMC and Himax aligns with India’s vision of becoming a global semiconductor hub, reducing reliance on imports and fostering local innovation.

2. Job Creation and Economic Growth: The new manufacturing unit is expected to generate thousands of direct and indirect jobs, supporting local economies and enhancing India’s manufacturing expertise.

3. Global Supply Chain Resilience: By developing indigenous semiconductor production capabilities, India can position itself as a reliable alternative to traditional chip-manufacturing giants like China, Taiwan, and South Korea.

4. Attracting More Investments: The project sets a precedent for future investments from global semiconductor firms, reinforcing India’s potential as a semiconductor powerhouse.

Overall: Tata Electronics’ latest expansion is a big step toward India’s goal of technological self-sufficiency. As the country strengthens its semiconductor ecosystem, it not only enhances domestic manufacturing capabilities but also contributes to global supply chain diversification.

Read more: Economic Times

GENERAL OVERVIEW

🗞️ Bite-sized summaries

🏦 RBI meetings with Fintech giants - The Reserve Bank of India (RBI) recently held a meeting with fintech firms and payment system operators to discuss the evolving financial ecosystem. Led by the RBI Governor and Deputy Governors, the discussion focused on the need for responsible innovation and regulatory compliance, especially for new players in the sector. RBI reaffirmed its commitment to an open and consultative approach, encouraging industry dialogue. Participants shared insights on digital payments, fintech advancements, and their expectations from the central bank.As India’s fintech sector continues to grow, balancing innovation with compliance is essential for financial stability and consumer trust. This engagement underscores RBI’s role in shaping a secure and dynamic digital financial landscape.

🏅 Olympic grant - The U.S. Olympic and Paralympic Committee (USOPC) has announced a groundbreaking $100 million grant from Ross Stevens to support athletes’ long-term financial security. Every Olympian and Paralympian competing from the 2026 Milan Games through at least 2032 will receive $200,000 per participation. However, the first $100,000 will only be available 20 years after their competition or when they turn 45, with the remaining amount going to their families after their passing. This initiative aims to ease the financial challenges athletes face, as they often lack salaries or retirement plans. Unlike other countries, the U.S. relies entirely on private funding, making this grant a vital step toward securing athletes’ futures.

HEADLINES

🧑‍🍳 What else is cookin’?

What’s happening in India (and around the world 🌍️)

• Nithin Kamath of Zerodha named EY Entrepreneur Of The Year 2024.

• Delhi ranks 18th, Mumbai 21st, Bengaluru 40th globally in luxury housing price rise.

• Tesla’s maiden India showroom lands in Mumbai’s BKC, sets lease rate national record.

• Two-wheeler financiers go slow on loans as defaults inch up.

• UK says Microsoft-OpenAI partnership does not need antitrust investigation.

CULTURE

🍿 Entertainment, Entertainment, Entertainment

• New Zealand outbat South Africa to set up Champions Trophy final with India.

• Stefanos Tsitsipas secures his first title in nearly a year by defeating Felix Auger-Aliassime 6-3, 6-3 in the Dubai final.